Morgan Stanley: The upward trend in the semiconductor industry has not yet peaked; raises target prices for IonQ, Microchip Technology, and GigaDevice.

Morgan Stanley has released a report stating that even though the iShares Semiconductor ETF (SOXX-US) has surged nearly 57% year-to-date through 2026, the rally in the semiconductor sector has not yet peaked, and the real profit drivers will be the next force to push prices even higher. The report highlights that the semiconductor industry is shifting from growth driven purely by AI themes to a recovery supported by both AI and traditional cyclical demand. Morgan Stanley specifically singled out three representative companies across the quantum computing, microcontrollers, and foundry segments—IonQ, Microchip Technology, and GlobalFoundries. Morgan Stanley raised IonQ’s target price from $38 to $47. While IonQ currently has a smaller base, with quarterly revenue of about $11 million to $12 million, Morgan Stanley believes its revenue path for 2026 has become clearer. Morgan Stanley sharply increased Microchip Technology’s target price from $69 to $92, as the company is positioned to convert recovering demand into faster profit growth. Morgan Stanley raised GlobalFoundries’ target price from $47 to $58, as the company has built a more durable product portfolio through stable chip-technology pricing and its leading position in silicon photonics.